Blue Ridge Marathon Economic Impact 2014 by Pete Eshelman

2014Ec onomi cI mpac tAnal y s i s Roanok e,VA

This report was prepared by the Roanoke Valley – Alleghany Regional Commission and Roanoke Regional Partnership. The economic impact analysis provided in this report was generated using an economic impact model calibrated for a specific study area using standard regional data sets. The results are to be interpreted as a best estimate of economic impact based on the assumptions and/or data provided. The Roanoke Valley – Alleghany Regional Commission does not guarantee the accuracy of data or assumptions supplied by the client or of any other source, nor does it advocate or guarantee the success of any particular policy change, course of action, or any decision that may be ultimately based on the information in this report. The Roanoke Valley – Alleghany Regional Commission is not responsible for any errors, omissions, the accuracy of data/inputs supplied by its client(s), or for the ultimate use of this data including any decisions made or the effects of any decisions made based on the information in this report.

Sponsors Foot Levelers Anthem WDBJ Carilion Clinic Roanoke Regional Partnership RoanokeOutside.com Fink’s Jewelers Tag Heuer Roanoke City Roanoke Parks and Recreation Ride Solutions Branch Highways Carter Machinery City Market Building Ferrum College Rotary Club of Roanoke Downtown Parkway Brewing Starr Hill Brewing Scott Insurance Floyd Fest Walkabout Outfitter Cole and Associates CPAs Black Dog Salvage Prescott Construction Tinnell’s ACE Private Risk Services Grand Home Furnishing Scott Avis – MKB Texas Tavern The River and Rail Frith Anderson & Peake Dominion Electric Vehicles Mountain Junkies Twin River Outfitters Wilderness Adventure at Eagle Landing United Dairy Coca Cola Community Partners Roanoke Parks & Recreation Rotary Club of Downtown Branch Highways Carter Machinery Roanoke Symphony Orchestra Dominion Electric Vehicles YMCA Roanoke Public Works Transportation Roanoke Solid Waste Management Down by Downtown Star City Striders Fleet Feet Sports Clean Valley Council

Friends of the Blue Ridge Parkway Roanoke Valley CVB Downtown Roanoke Inc. Opera Roanoke Salem Civic Center Roanoke Civic Center Tidy Services Jefferson Center Down by Downtown 101.5 the music place Odyssey Adventure Racing Burton Center for Arts and Technology Cox Roanoke Valley Alleghany Regional Commission Police & EMS Roanoke Police Department Roanoke Emergency Medical Services Roanoke Fire – EMS Roanoke County Police Roanoke County Police Roanoke City Sheriff Vinton Police Carilion Police Virginia Western Police Norfolk Southern Police National Park Service FBI Blue Ridge Volunteer Rescue Cave Spring Volunteer Rescue Carilion Clinic Patient Transportation Near Southwest Preparedness Alliance City of Roanoke Emergency Management City of Roanoke E911 Communications VTC Medical School Jefferson College Paramedic Program

Introduction On April 26, 2014, the Roanoke Region welcomed 1,594 runners who participated in the fifth annual Foot Levelers Blue Ridge Marathon event series, which included the full marathon, half marathon, and Star K 10K races. Billed as America’s toughest road marathon, the race course started in downtown on Jefferson Street and ended at Elmwood Park and went from the low elevations of downtown Roanoke and the Roanoke River to the higher elevations at the top of Mill Mountain and Roanoke Mountain along sections of the Blue Ridge Parkway for a total elevation change of 7,430 feet. Race organizers knew it would be of vital importance to gauge the economic impact of the race event. Such information would be instrumental in helping the community to understand the impacts such events bring to the community and to build support for future marathons in the Roanoke Region of Virginia. The Roanoke Regional Partnership and Roanoke Valley – Alleghany Regional Commission worked to prepare a participant survey and to prepare this assessment of the economic impact of the event.

Figure 1: Study Area Location

Methodology A survey was produced jointly by Roanoke Regional Partnership and the Roanoke Valley – Alleghany Regional Commission by improving on the survey instrument from the previous year. The survey was distributed to event participants in the week following the event. Participation was incentivized with discounted entry into the 2014 marathon. In total, there were 839 respondents to the survey, representing a response rate of approximately 52.6 percent of actual participants. The study area for this analysis was defined as the Roanoke Metropolitan Statistical Area, which is composed of the Counties of Botetourt, Craig, Franklin, and Roanoke; and the Cities of Roanoke and Salem.

Survey responses were used to compute average expenditures for food, lodging, and retail purchases made in the region per person per day. The IMPLAN (IMpact Analysis for PLANning) economic impact model for the Roanoke Metropolitan Statistical Area (using 2011 IMPLAN data for the study region and utilizing social accounting multipliers) was employed to estimate the amount of regional activity originating from the Marathon event. IMPLAN is an economic impact modeling software first developed jointly by the University of Minnesota and the US Forest Service in the 1970’s and later expanded upon by the Minnesota IMPLAN Group. The modeling software and IMPLAN proprietary data set is currently maintained by the Minnesota IMPLAN Group, a private company based in Stillwater, Minnesota. IMPLAN is widely used by a number of universities, economic consultants, economic development professionals, and others involved in

estimating economic impact of programs and events. IMPLAN models the flow of expenditures through industries and institutions of a regional economy that result after an initial economic stimulus is made in a given economy. More information on the IMPLAN model and data set can be obtained at http://www.implan.com. Survey Results The survey was conducted by Roanoke Regional Partnership. The survey yielded 839 responses for a response rate of 52.6 percent. Geographic Dispersion Approximately 72 percent of runners were from the state of Virginia and 81 percent were from the southeastern United States. In all, there were 38 states represented in addition to the District of Columbia. Australia, Canada, Czech Republic, Germany, Italy, and Switzerland were also represented.

Figure 2: Marathon Participation by Year

Marathon Participation 1,800 1,600 1,400

887

1,200

944

1,000 800 600

636

560 407 797

400 200

306

318

650

392

0 2010

2011 Local runners

2012

2013

2014

Extra‐regional runners

Overall participation was comparable to last year with roughly five percent fewer runners overall1. Extraregional runners which introduce new money into our region by spending on goods and services surrounding the day of the event increased by 6.4 percent over last year. Utilizing the runner registration list, it was determined that 59.2 percent of participants originated from outside the study area and were therefore counted as visitors in the analysis. Those originating from outside of the MSA were divided into

There were more registrations in 2013 year than 2012, but a higher rate of non‐attending registrants contributed to a slightly lower participation level overall.

those who were likely to have made a day-trip out of running in the marathon and those who were likely to have spent the night based upon the distance traveled to attend. Generally, those traveling one and a half hours or more were classified as having spent the night. Generally, survey results supported this classification with the majority of runners from one and a half hours or more indicating some hotel expenditure associated with the event. There were 773 participants classified as ‘overnighters’ and 171 participants classified as ‘day-trip’ visitors. It is important to note that expenditures of visitors to the area are of chief concern to this analysis, since such expenditures represent new money entering the region. An argument can be made that certain local expenditures were induced by this event, but these are typically of concern to an analysis such as this when a demonstrated case of import substitution can be shown. Income and Education

Figure 3: Household Income of Participants

What is Your Household Income Range? $150,001$200,000 8%

Less than $25,000 $25,000$50,000 4% 15%

Over $200,000 8%

$100,001$150,000 19%

$50,0001$75,000 21% $75,001$100,000 25%

Most runners, approximately 75 percent, held at least a four-year degree and 40 percent held advanced degrees. Approximately 35 percent made over $100,000 last year. Length of Stay A significant proportion (44 percent) of survey respondents reported staying in town for the 2014 Blue Ridge Marathon for at least one night. Approximately 35 percent stayed between one and two nights in the region. The average length of stay among respondents at least one and a half hours from the race start location was 1.81 nights. Size of Travel Party Just over 48 percent of respondents reported traveling with family or friends. Respondents were asked to report the number of non-participants that traveled with them. The average size of the travel party among

respondents more than one and a half hours from the race was 2.3. Other respondents living outside the study area traveled with an average of 1.4 others per participant. Visitation to Local Attractions Participants were asked if they visited any local attractions such as the Down by Downtown Music Festival, Taubman Museum of Art, Virginia Transportation Museum, Mill Mountain Star, etc. Approximately 61 percent of respondents more than one and a half hours from the race reported visiting a local attraction. Approximately 47 percent of other respondents living outside the study area reported visiting a local attraction. Average Expenditures Respondents were asked to report the amount spent by their entire travel party on fuel, meals, lodging, miscellaneous retail purchases, and admissions while in the study area. The following were the average values for those respondents who were from outside of the study area.

Figure 4: Average Travel Party Expenditures Category Lodging Meals Gas Misc. Retail Admissions

Overnight Visitors $99.08 $67.38 $43.02 $48.66 $6.96

Day-trip Visitors -$55.13 $30.81 $50.23 $6.50

These average per travel party per day expenditures were used to identify an initial direct impact figure input into the IMPLAN model2. The number of visitor days3 associated with the Blue Ridge Marathon was multiplied by each category to determine the direct impact in the restaurant, hotel/motel, general merchandise retail, gasoline, and museum/historical site industries. These direct impacts were entered into the IMPLAN model. The software was instructed to consider only the retail margin of retail purchases (the wholesale cost of each product likely leaves the region as in most cases the product is manufactured elsewhere and the margin also does not include the costs of transporting the product to the store). Purchases made by the race organizers for goods and services in the study area were also added since the majority of funds used in organizing the marathon were race entry fees. Donations to local charitable organizations having their headquarters in the region were also considered since those organizations operate within the study area. The fees paid by the participants from outside the study region far surpassed these local expenditure and donation amounts. The IMPLAN model calculates a direct, indirect, and induced impact after adjusting the initial direct impact for leakage by using estimated retail margins.

2 As a general rule, only those expenditures made by visitors are used in any estimate of economic impact since local spending represents recirculation of wealth within a local economy. While there were 650 local runners, 475 known local volunteers, and at least 3,500 local spectators that likely spent local funds on lunch and snacks during the day of the event and likely made other expenditures that they might not have spent otherwise, there is no method short of a volunteer/spectator survey to determine the proportion of local participants that would have travelled outside the region as opposed to participating in the Marathon activity. A case for import substitution simply cannot be made without this data. 3

Visitor days are computed by multiplying the number of participants who are from outside the region by the average travel party size and by the average length of stay.

Economic Impact It is estimated that the fifth annual Blue Ridge Marathon attracted $322,200 in direct new sales activity to the region, which lead to an additional $199,126 in indirect4 and induced5 spending for a total impact on output6 of $521,326. This corresponds to an increase of $276,539 in value added7 to the regional economy. Activity surrounding the event will support the equivalent of 6.1 jobs in the region for the period of a year8.

Figure 5: Summary Economic Impact Table Output $322,200 $103,047 $96,079 $521,326

Direct Effect Indirect Effect Induced Effect Total Effect

Employment 4.4 0.9 0.8 6.1

Labor Income $102,840 $33,724 $30,110 $166,674

Value Added $158,469 $59,149 $58,921 $276,539

The impact of the marathon increased 9 percent over 2013. An increase in participants from farther away from the event as well as increases in average travel party expenditures translated into a higher net economic impact. The chart below summarizes the impacts of the previous marathon events. In all, the event has supported more than two million dollars in regional economic activity in its first five years.

Figure 6: Marathon Impact by Year

Marathon Impact by Year $476,369 $521,326 $346,776

$339,079

2010

2011

$377,198

2012

2013

2014

Indirect impacts are those represented by local industries purchasing from other local industries as a result of a direct economic event. Indirect impacts represent a cumulative total of several cycles of spending that work its way through the local economic supply chain until all remaining money from the initial stimulus leaks from the study area economy. For instance, a series of restaurants making purchases of goods from local suppliers as a result of participant spending on meals would be an example of a portion of indirect impacts as defined in this analysis. 5 Induced impacts are those impacts that result from household spending by those impacted in the direct and indirect phases of economic impact. The respending of wages earned by employees working for industries impacted into the local economy represents the largest portion of induced impacts. 6 Output can generally be understood as regional sales activity. Output is more precisely defined as the value of industry production. In the case of service industries, which are primarily involved in the tourism and visitation industry, the value of production equals sales. 7 Value added is defined as the difference between an industry’s total output and the cost of any intermediate inputs. Value added includes employee compensation, taxes, and operating surplus. Value added is best understood as the contribution made to gross domestic product or, more simply, as new wealth in the region. 8 The IMPLAN model considers employment to represent annual average full‐time/part‐time jobs, which may manifest themselves as overtime and/or retention of a job in the service industry that might otherwise have been lost without the economic stimulus.

APPENDIX

2014 Blue Ridge Marathon Race Series 1.

Please answer the following questions as completely and accurately as possible. All responses will remain confidential. Your answers not only help us improve the event, but they also help us attract the right corporate sponsors, which translates into a better experience for you. Thank you for participating and for taking the time to help us improve our efforts for next year. Sincerely, Pete Eshelman Chair, Blue Ridge Marathon Roanoke Outside Foundation

1. For purposes of determining local economic impact, please enter your zip/mail code below.

2. Which event did you participate in this year? j Full Marathon k l m n

j Half Marathon k l m n

j Double Marathon k l m n j Star K k l m n

3. How did you hear about this event? Select all that apply. c Friend or Family Member d e f g c Facebook d e f g c Twitter d e f g

c Blue Ridge Outdoors d e f g

c #RunChat d e f g

c From an Official BRM Blogger d e f g c Odyssey Adventure Racing d e f g

c Active.com d e f g

c Endurance Mag. d e f g

c Competitor Mag. d e f g

c Other (please specify website or other source) d e f g

c Chiropractic Magazine d e f g

4. Did you participate in any previous Blue Ridge Marathons or Half Marathons?

c Yes, I participated in the 2011 event d e f g c Yes, I participated in the 2012 event d e f g c Yes, I participated in the 2013 event d e f g c No, this was my first time! d e f g

c VA Beach Rock n Roll Expo d e f g

c Yes, I participated in the 2010 event d e f g

c Richmond Marathon Guide d e f g

c Washington Running Report d e f g

c Baltimore Marathon Guide d e f g

c MarathonGuide.com d e f g

c Blog Website about Running d e f g

2014 Blue Ridge Marathon Race Series 5. Where did you stay during the event? j I didn't stay overnight k l m n j I live locally k l m n

j Courtyard Marriott k l m n

j Fairfield Inn & Suites k l m n

j A family or friend's house k l m n j Cambria Suites k l m n j Hyatt k l m n

j Ramada Inn k l m n

j Sheraton k l m n

j King George Inn k l m n

j Mainstay Suites k l m n

j Comfort Inn Airport k l m n

j Hotel Roanoke k l m n

j Other Hotel/Motel k l m n

If other hotel/motel, please specify.

6. How many miles did you travel to the event? j 0 to 50 k l m n

j 51 to 100 k l m n

j 201 to 500 k l m n

j 101 to 200 k l m n

j 501 to 1,000 k l m n

j More than 1,000 k l m n

7. How many nights did you stay in the area for the Blue Ridge Marathon? j 0 k l m n j 1 k l m n j 2 k l m n j 3 k l m n j 4 k l m n

j 5 k l m n

j 6 k l m n

j More than 6 k l m n

j Local resident/No hotel stay k l m n

8. Did you travel with family or friends?

j Yes k l m n j No k l m n

If yes, how many nonparticipants traveled with you?

9. Did you visit any local attractions? Please select all that apply. c G. Love & Special Sauce Concert d e f g c Taubman Museum of Art d e f g c Center in the Square d e f g

c O. Winston Link Museum d e f g

c Mill Mountain Zoo d e f g

c Virginia Museum of Transportation d e f g

c Mill Mountain Star d e f g

If other attraction(s), please specify.

c Other d e f g

c Roanoke River Greenway d e f g

c Carvins Cove d e f g

2014 Blue Ridge Marathon Race Series 10. Please enter the amount (to the nearest whole dollar) spent PER DAY on the following commodities/services by your entire travel party while in the area? Lodging Dining Gasoline Retail Purchase Admissions (Local Attractions)

11. We are donating $500 to the company with the best aid station. Please tell us which aid station was the best. These are listed in order, from start to finish. j #1 Walnut & Sylvan (mile 1 all races and mile 5 for half and 10K, and mile 14 for full) k l m n

j #2 Fishburn Parkway & Prospect (Spur) Road (mile 2.5 all races, repeat mile 12 for full) k l m n j #3 Roanoke Mtn. Campground (full course only; miles 4 and 10.5) k l m n j #4 Gum Springs Overlook (full course only; mile 5 and 9.5) k l m n

j #5 Mill Mtn. Overlook Halfway Up Roanoke Mountain (full course only, mile 6) k l m n j #6 Top of Roanoke Mountain (full course only, mile 7) k l m n

j #7 Bottom of Roanoke Mountain (full course only, mile 8.75) k l m n

j #8 Mill Mountain Star Overlook (mile 3.5 for half and 10K, mile 13.5 for full) k l m n j #9 River's Edge Park (mile 6.5 for half and mile 15.5 for full) k l m n

j #10 Peakwood & Somerset Intersection (mile 7.75 for half and mile 16.75 for full) k l m n j #11 Top of Peakwood (mile 8.5 for half and mile 17.5 for full) k l m n

j #12 Very Top of West Ridge Circle champagne stop (mile 9.5 for half and mile 18.5 for full) k l m n j #13 27th & Crystal Spring Intersection (mile 10.5 for half and mile 19.5 for full) k l m n

j #14 Jefferson & Riverside Circle Intersection (mile 12 for half and mile 21 for full) k l m n j #15 End of Ferdinand Ave (mile 22.75 for full) k l m n

j #16 Wasena Ave. & Brighton St, top of Jesus Saves hill (mile 24.25 for full) k l m n j #17 YMCA on Luck Ave. (mile 25.5 for full) k l m n

2014 Blue Ridge Marathon Race Series 12. Please rate the following from 10 (best) to 1 (worst). 10 Excellent

1 Worst

Overall Experience

j k l m n

Registration (online)

j k l m n

Registration at event

j k l m n

Quality of Participant Shirt

j k l m n

Artwork on Participant Shirt

j k l m n

Race Staff/Volunteers

j k l m n

Communications with Event

j k l m n

Course

j k l m n

Awards Ceremony

j k l m n

Finish Line Food and

j k l m n

Hydration/Fuel Stations

j k l m n

Event Website

j k l m n

Timing

j k l m n

Expo

j k l m n

Music and Festivities

j k l m n

Staff

Beverage

Following the Event Race Photographs

13. How would you rate the pasta dinner with guest speaker Zoe Romano? Skip question of you did not attend. Worst

Bad

Good

Excellent

Price

j k l m n

Timing

j k l m n

Speaker

j k l m n

Quality of Food

j k l m n

Other Pasta Dinner comments?

14. Gender j Male k l m n

j Female k l m n

2014 Blue Ridge Marathon Race Series 15. Age j Under 18 k l m n j 18 to 25 k l m n j 26 to 30 k l m n j 31 to 35 k l m n

j 36 to 40 k l m n

j 41 to 45 k l m n

j 46 to 50 k l m n

j 51 to 55 k l m n

j 56 to 60 k l m n

j 61 to 65 k l m n

j 66 to 70 k l m n

j Over 70 k l m n

16. What is your ethnic origin? c Caucasian d e f g

c Black or AfricanAmerican d e f g c Hispanic/Latino d e f g c Asian d e f g

c I prefer not to answer d e f g c Other d e f g

17. What is your household income range?. This is anonymous and not seen by anyone. This information helps us get the right corporate sponsors which translates to a better event for you. j Less than $25,000 k l m n

j $25,000 to $50,000 k l m n j $50,001 to $75,000 k l m n

j $100,001 to $150,000 k l m n

j $150,001 to $200,000 k l m n

j $75,001 to $100,000 k l m n

j Over $200,000 k l m n

18. What is the highest level of education you have completed? j Less than High School Diploma k l m n j High School Diploma k l m n j Associate's Degree k l m n j Bachelor's Degree k l m n j Master's Degree k l m n

j Doctoral/Professional Degree k l m n

19. Would you recommend participating in the Blue Ridge Marathon, Half Marathon, or 10K to others?

j Yes k l m n j No k l m n

2014 Blue Ridge Marathon Race Series 20. What did you like about this event? 5 6

21. What could we do better? 5 6

22. Would you like to leave a testimonial for use in marketing future events? If so, please enter it below. 5 6

23. Get a 50% discount off next year's race. Just leave your name and email and we'll send you a discount code once registration opens. Code will not be available before registration opens and will only be valid for two weeks. The 2015 date is April 18. Name Email